Sunday, April 15, 2012

A Ramsey No No

For those of you that are fellow fans of Dave Ramsey and becoming debt free, I have a confession to make.

In order to keep from going further into debt (We currently owe tens of hundreds of thousands on our happy home) and to avoid making payments we simply could not afford, we decided to save up for our next automobile.

Unfortunately, our previous automobile refused to cooperate with this plan and we were forced to look around for something different last year.

They say that if you have to get some sort of financing, you should get pre-approved from your financial institution. So, we dutifully took care of that.

But, when we found the vehicle we wanted at a lot run by the Serbian mafia, we ran into a snag. Our credit union wouldn't give us the funds until they had the title in hand. The car dealer wouldn't give up the title until they had the money in hand. They went back and forth and were at an impasse. We had to find another solution.

So, we used one of those check offers from a credit card company that they keep sending in the mail. Apparently you can just write the amount of the car you want on a check, they cash it for you at the bank and you have interest free money for a year. As long as you actually pay it off in a year. Otherwise, you will have to pay interest, not only for the money you still owe, but for all the money you borrowed too.

We paid that thing off this month. Now that is worth celebrating. Now, if we could only find a little money in our monthly budget to start putting some away for the next vehicle. These things seem to wear out on a regular basis.


Do not actually try doing what we did. If you do, you are probably an idiot and will end up paying tons of extra money in interest that you never would have had to if you just waited and saved your money.

And you will offend every Ramsey acolyte in the world, which is why I didn't make this confession until we paid for our knowing blunder.


Eileen Short said...

Those credit card checks are scary...while the majority of people get into trouble with these checks' incentives, glad to hear it worked out to your advantage.
What kind of car did you get?? Car shopping is so fun...ha!

Anonymous said...

I'm a Ramsey fan myself. I just can't seem to get over that auto hump either. I did stop leasing...huge blunder...and purchased this one.

Mrs. FPF said...

We have NEVER used a check like that before.... however, the lady at the bank told me you can get a loan on your car anytime you want, as long as there is equity. Who knew?
So we figured if, by some chance, we didn't pay it off, we could do that and avoid the incredibly high interest rate of the credit card.
Thanks, honey, for working so hard for us!
Eileen-we got a 2006 Kia Sedona. We really like it!

DC Le Peau said...

How dare you!

Ok, since you confessed I will too...we still have a credit card (gasp) and will until we have completed our full emergency fun (under way).

Now take that money you used to pay off the Kia and put it toward your next car, Ramsey said so.